What Is Share Market ?
Share Market is a place where investors and traders buy and sell stocks. Stock Market is a place where people can invest into businesses which they likes. Businesses launched their IPO in primary market and raise funds to grow their business. Investors invest in IPOs and hold shares for long term to create wealth. Traders buy and sell stocks randomly to gain quick profit.
After launching IPOs, shares can traded in secondary market where we can buy and sell at any instance. In primary market company decide share price on behalf of valuation. but in secondary market investors, traders also market sentiment decide share price some time it become undervalued and some time it become overvalued but we can decide actual share price with the help of DCF model.
Who Regulate Stock Market ?
Stock market is regulated by government. In India securities and Exchange board of India (SEBI) regulate stock market and In USA Securities and Exchange Commission (SEC). Stock Exchanges doesn’t own any shares but they meet buyers and seller.
How Stock market Works ?
A entrepreneur starts a company and issue shares then they need funds to grow their business they raise funds through primary market by giving shares to public after all shares listed and common people buy and sell shares.
From where we can buy shares ? they can buy shares from brokers. Directly we can buy from brokers ? no we need demat account for that. open demat account with any broker in our case broker is Upstox. after opening demat account we buy and sell shares and we need to store shares in dematerialize form with Depositories.
Depositories store shares like banks we store our money into it. In our case depositories are Central Depository Services (India) Limited. (CDSL) and National Securities Depository Limited( NSDL).
When we buy shares brokers, depositories, government,stock exchanges charge some amount of fees from ours. Broker charges brokerage, depositories charge dp charge, government charge stt, regulator charge sebi fees,etc